Company overview

OLYMPUS CORPORATION, a Japan-based manufacturer, mainly manufactures and sells medical products, life and industrial products, imaging products, information communication products and other products. The Company operates in five business segments.

Life and Industrial: Provides biological microscopes, industrial microscopes, endoscopes for industrial use and non-destructive testing equipment

Imaging: Manufacture and sale of digital cameras and voice recorders

Information Communication: Sale of mobile terminals, such as cellular phones

Others: Development of biomaterials and systems, industrial endoscopes, nondestructive inspection equipment, printers, mobile solutions and mobile contents services, the development and sale of package software, the sale of semiconductor-related equipment and electronic machines, as well as the development of systems

In August 2009, the Company disposed its analytical equipment business to its wholly owned subsidiary, which has been engaged in the manufacturing and sale of clinical laboratory examination equipment. In addition, the Company has sold the subsidiary to Beckman Coulter, Inc. on August 1, 2009. As a result, the Company holds no stake in the subsidiary.
As of March 31, 2011, the Company has 188 subsidiaries and 11 associated companies.

Revenue Distribution

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Source: SEC fillings

Patents Held by Business group

Business Segment

Medical Systems

Life science & Industrial Systems

Imaging Systems

R&D/Innovation

Total

Japan patents

2941

1067

2021

1131

7160

US patents

1059

680

1534

974

4247

China patents

405

86

444

90

1025

Other patents

948

249

102

165

1464

Total

5353

2082

4101

2360

13896

In Medical systems business, the company owns 39% of the total number of patents held by the company, with Japanese patents being the highest contributor to that.

Business Overview

Business lines

The company operates under the following business lines:

Organisation Structure

In April 2011, the company launched their regional headquarters for Asia and Oceania to coordinate regional strategy and facilitate business infrastructure development.
Source: Company website, Linkedin

Medical Systems Business

The Medical Systems Business covers gastrointestinal endoscopes, surgical endoscopes, endotherapy devices, endoscopic ultrasound systems and medical information systems.
With an approximately 70% share, the Olympus group has secured a leading position in the global Gastrointestinal endoscopy market. Working to expand diagnostic coverage beyond the digestive system, the group is developing new equipment and new techniques ranging from diagnosis through treatment.
It's current research focus is on both minimally invasive treatment technology that reduces the burden on patients and product usability, for example, enhanced performance and functions to benefit doctors and technicians. The group's flagship products are equipped with a high-resolution endoscopic system and Narrow Band Imaging technology so that they can also support cancer diagnosis and treatment.

Revenue

Medical systems business is the biggest business segment of Olympus corporation:

Net sales ratio : 40% approx.

Contribution to total corporate operating income :109% approx.

(before corporate allocation of expenses)

Metrics ( in Billion Yen)

2009

2010

2011

Medical Systems

Domestic

76.2

75.1

79.4

Overseas

307.6

275.7

275.9

Total

383.89

350.75

355.46

Endoscopes

Domestic

44.6

40.9

43.8

Overseas

168.3

151

151.6

Total

212.9

191.9

195.5

MIP

Domestic

31.6

34.2

35.6

Overseas

139.3

124.6

124.3

Total

170.9

158.8

159.9

Projections for FY 2012

Quarter 3

In endoscopes, new shipments of some products (Lucera) have ground to a halt, but the company expects to see a rebound in 2nd Half. For the year as a whole it projects endoscope sales will be down 5% YoY.

The company estimates 1st Half sales in the medical systems division at JPY165bn (-6% YoY), and OP at JPY27bn; it projects 2nd Half sales at JPY195bn (+8%) and OP at JPY43bn.

In the medical systems division, new product launches are planned for both surgical endoscopes and energy devices (treatment tools).

It projects sales of MIPs (surgical endoscopes, treatment equipment) at JPY180.5bn (+10% YoY). Sales in FY3/11 were flat YoY due mainly to the strength of the yen, but positive growth is expected this year.

The company projects sales of gastrointestinal endoscopes at JPY164bn, -5% YoY, reflecting production setbacks in 1st Half.

The earthquake’s impact has caused bottlenecks in purchasing of parts and materials for gastrointestinal endoscopes,leading to delays in product launches. In the latest telephone conference, the company offered no new information about timing. We believe there has been no real change from the company’s comments at the results briefing in May,and it remains to be seen whether the company will be able to launch its new products this fiscal year. The company’s FY3/12 earnings forecasts do not reflect any contribution from new products. Sales in the medical systems division got off to a slow start, falling short of projections in April-May.

Gastrointestinal Endoscopes Business

With an approximately 70% global market share for gastrointestinal endoscopes and an established position at the medical vanguard, Olympus maintains its passion for advancing technologies in response to doctors' needs

Diagnosis and Treatment using Gastrointestinal Endoscopy

Diagnosis

Biopsy

Cytodiagnosis

Staining

Treatment

Cancer (esophageal, stomach, colon, etc.)

Varcies (esophageal)

Foreign object retrieval ( esophagus, stomach)

Hemostasis (stomach)

Ployps (stomach, colon)

Gallstones, bile duct stenosis (duodenum)

Market Share

Source: Espicom

Company ( in Billion Yen)

2009

2010

2011

Olympus

212.89

191.94

195.45

FujiFilm HD

26.98

25.00

27.00

Hoya

48.87

47.00

45.00

Products Offered

Speciality

Details

Picture

Products

Gastroscopy

Endoscopic examination, therapy or surgery of the interior of the stomach.

GIF-H180J: Enables one to perform upper gastrointestinal endoscopy utilising the latest auxiliary water function and the sharpest possible image quality provided by High-resolution HDTV images featuring Narrow Band Imaging™ (NBI) and Close Focus

GIF-H180: Delivers the best possible image quality for upper GI. High-resolution HDTV images in combination with Narrow Band Imaging (NBI) and Close Focus functionality

JF-140R: Facilitates introduction and manipulation of EndoTherapy accessories (for example papillotomes and ERCP catheters). The removable distal cap makes it possible to have access to all sides of the forceps elevator which can consequently be easily and quickly cleaned.

Colonoscopy

Endoscopic examination, therapy or surgery of the luminal surface of the colon.

CF-H180AI/L: High-resolution HDTV images combined with the widest field of view ever available in a colonoscope: 170° lets you look even behind the folds potentially decreasing the miss-rate and improving orientation inside the colon.

CF-Q180AI/L: The widest field of view ever available in a colonoscope: 170° lets you look even behind the folds potentially decreasing the miss-rate and improving orientation inside the colon.

CF-Q160DI/L: ScopeGuide is a new Olympus product, which displays the shape and position of a colonoscope in real time throughout the examination without the use of x-rays. It based on magnetic fields generated by small coils build inside this endoscope and picked up by the antenna of ScopeGuide's main unit. From this data, the computer reconstructs a schematic picture of endoscope on the display.

CF-1T140I/L: For use in both therapeutic procedures and routine examinations, offers “graduated flexibility” for ease of insertion, and greater operational control and torque transmission to the distal end.

Endoscopic examination, therapy or surgery of the luminal surface of the rectum.

Rectal Diagnostic System: a complete line-up of instruments for rectoscopy, which have been especially designed for the diagnosis of possible disorders in the rectal region. Highest functionality combined with long-term durability distinguishes these instruments at reasonable investment costs.

Transanal Endoscopic Microsurgery System: a versatile line up of transparent tubes enable clear inspection of the affected area. Access to a lesion is made easier by a "side window sheath". Fully compatible with standard VISERA equipment.

Enteroscopy

Endoscopy of the small intestines accomplished while advancing the endoscope into the intestines from the stomach

Biopsy Forceps: Specially designed to minimize damage to the enteroscope with it's stainless steel construction.

Sigmoidoscopy

Endoscopic examination, therapy or surgery of the sigmoid flexure

PCF-S: Easy-reach L/R adapter (MAJ-1072) improves control and comfort for smaller hands and has a soft insertion tube for easier insertion and improved patient comfort. It is compatible with CV-180, CV-160 and CV-140 video processors.

CF-Q160S: Superior image quality with large display size provides enhanced details throughout the image plane. When used in combination with the company's dedicated flushing pump and CV-160 video system center, a continuously clear view is ensured by a forward water jet that removes obstacles inside the colon at the touch of a switch on the scope.

New Products

Scope Guide:

is an exclusive Olympus technology designed to provide a real-time 3D image of the shape and configuration of the colonoscope inside the body. ScopeGuide assists with finding the optimal location to apply abdominal pressure, easier, more confident scope insertion, and early loop identification. The use of ScopeGuide during colonoscopies may lead to less patient discomfort. By seeing the shape of the entire scope as it moves through the body, ScopeGuide provides additional visual information that is particularly helpful during difficult colonoscopies. The endoscopist can evaluate the extent of looping and get a better sense of which rotational maneuvers will be required to straighten out various loop formations that can occur during colonoscopy.

Evis Lucera Colono-Videoscope: It helps in reducing the burden on patients and improving performance for both the inspection and treatment of colorectal cancer through the incorporation of two new functions, namely, high flexibility and highly responsive control at the insertion site, while adopting a thinner scope.

Evis Lucera Gastrointestinal Videoscope: This slim gastrointestinal videoscope can be inserted through the nasal tract or the mouth to realise high quality images and is suited for the examination of lesions in the upper digestive tract, for example, in the stomach.

Capsule Endoscopes:

They are non-invasive, endoscopic imaging by use of VIDEO CAPSULE ENDOSCOPES to perform examination of the gastrointestinal tract, especially the small bowel. After being introduced in 2007, they have become a revolution. High-resolution imaging, real-time viewing, ease of use and proprietary hard and software make EndoCapsule a comprehensive and powerful system - redefining capsule endoscopy. One has to simply swallow the Endo capsule, a pill sized (11mm in external diameter and 26mm in length) capsule equipped with a tiny camera and lights, allows pictures to be taken of the entire small bowel. Endo capsule delivers high resolution images equivalent to those provided by endoscopes. EndoCapsule displays a clear and bright field of view for the fine observation of a variety of small bowel abnormalities.The Real Time Viewer enables the physician to test the proper functionality before the procedure and to confirm the location of the capsule in the GI tract during the process. In addition it is now possible to check whether and when the capsule has left the stomach.Product Details: